Treasury Announces Plan to Sell Airline Warrants (May 10, 2024)

Summary

A U.S. Department of the Treasury press release dated May 10, 2024, Treasury Announces Plan to Sell Airline Warrants. It states that Treasury announced its intention to conduct a series of auctions to sell its warrants to purchase the common stock of certain publicly traded airlines to qualified institutional buyers, institutional accredited investors, or the issuing airlines, with proceeds providing additional returns to taxpayers from pandemic assistance. It names Houlihan Lokey Capital, Inc. and Loop Financial Consulting Services, LLC as financial agents and states that prospective bidders must deliver a complete Bid Package by 5:00 p.m. Eastern Time on May 24, 2024, with the auctions expected to commence the week of June 3, 2024.

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U.S. Department of the Treasury

Press Releases

Treasury Announces Plan to Sell Airline Warrants

May 10, 2024

WASHINGTON – The U.S. Department of the Treasury announced today its intention to conduct a series of auctions to sell its warrants to purchase the common stock of certain publicly traded airlines to qualified institutional buyers, institutional accredited investors, or the issuing airlines. The proceeds of these sales will provide additional returns to the American taxpayer from the financial assistance and liquidity that Treasury provided to these airlines during the pandemic.

Treasury provided financial assistance and loans to U.S. airlines and certain other types of businesses in 2020 and 2021 under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act); the Consolidated Appropriations Act, 2021; and the American Rescue Plan Act of 2021. Information about these programs, the warrants being sold, and the auction procedures is available here .

Treasury will be supported by its financial agents, Houlihan Lokey Capital, Inc. and Loop Financial Consulting Services, LLC, to help coordinate and conduct the auctions. Prospective bidders interested in participating in an auction must deliver a complete Bid Package (as defined in the auction procedures) by 5:00 p.m. Eastern Time on May 24, 2024. The auctions are expected to commence the week of June 3, 2024.

The auction transactions will be exempt from the Securities Act of 1933, as amended (the Act). The warrants that will be sold in the auctions have not been, and will not be, sold pursuant a registration statement under the Act, and may not be offered or sold in the United States or to, or for the benefit of, U.S. persons absent registration under, or an applicable exemption from, the registration requirements of the Act and applicable state securities law.

The warrants will be offered only to (1) “qualified institutional buyers” as defined in Rule 144A under the Act, (2) certain institutional “accredited investors” as defined in Rule 501(a) under the Act, and (3) the issuers of the relevant warrants. Neither this press release nor the information regarding the auction on Treasury’s website constitute an offer to sell or the solicitation of an offer to buy the warrants or any other securities (including the underlying shares of common stock), and shall not constitute an offer, solicitation or sale in any jurisdiction in which, or to any persons to whom, such offering, solicitation, or sale would be unlawful.

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